SAIC Issues the Revised Measures for Administration and Supervision of Auction

Chinese version
Lately, the State Administration for Industry and Commerce ("SAIC") has released the revised Measures for Administration and Supervision of Auction (the "Measures"), effective from November 1, 2017.

According to the Measures, the incorporation of an auction enterprise is subject to the examination of the department in charge of administering the auction sector under the people's government of the province, autonomous region or municipality directly under the Central Government at the locality of the proposed enterprise, and a license for the engagement in auction business should be obtained as well. Further, the Measures expressly state that auctioneers are prohibited from performing eight acts, including "taking advantage of the auction announcement or otherwise to falsely publicize the object at auction in a misleading way", "selling its own articles or property rights at an auction organized by itself" and "retaining an individual who is not an auction master to preside over the auction". Moreover, the Measures stipulate that the principal should not participate in the auction activity or entrust others to bid on its behalf. And bidders are forbidden from colluding with each other maliciously for four purposes, such as "reaching an agreement to force the auction bidding price down". Additionally, bidders are not allowed to collude with the auctioneer maliciously for three purposes, such as "privately agreeing upon the transaction price".